Gaztransport & Technigaz Sa · EURONEXT:GTT
Gaztransport & Technigaz Sa — Investor Presentation (December 2014)
49 slides from Gaztransport & Technigaz Sa's investor presentation, December 2014
Slide 1: Investor Presentation December 2014
Investor Presentation December 2014 This document contains information resulting from testing, experience and know-how of GTT, which are protected under the legal regime of undisclosed information and trade secret (notably TRIPS Art. 39) and under Copyright law. This document is strictly confidentia
Slide 2: Disclaimer
DISCLAIMER ▶ This presentation does not contain or constitute an offer of securities for sale or an invitation or inducement to invest in securities in France, the United States or any other jurisdiction. ▶ It includes only summary information and does not purport to be comprehensive. No representat
Slide 3: Agenda
Agenda ▶ Key highlights of the first 9 months ▶ 1. Company Overview: GTT a global leader in LNG containment ▶ 2. Sector Forecasts & Business Update ▶ Market trends continue post-IPO ▶ New businesses showing promise ▶ 3. H1 Financials and 9 months revenues update ▶ 4. Strategy & Outlook ▶ Core busine
Slide 4: Key highlights of the first 9 months
Key highlights of the first 9 months ▶ Successful IPO ▶ Strong order intake leading to increased visibility ▶ Diversity of new orders and new contracts ▶ Return to LNGC market for historic licensee ▶ Creation of a UK subsidiary for training, successful inception of new training courses ▶ Several App
Slide 5: Company Overview: GTT a global leader in LNG containment
Company Overview: 1 GTT a global leader in LNG containment 5
Slide 6: GTT, leading engineering at the core of the LNG sector
GTT, leading engineering at the core of the LNG sector GTT offers broad exposure across the LNG shipping and storage value chain Exploration & Re- Off Take / Liquefaction Shipping Production Gasification Consumption Offshore clients: shipyards Platform / FLNG LNGC FSRU Gas-to-wire Installation Float
Slide 7: Deep relationships with all stakeholders of the LNG sector
Deep relationships with all stakeholders of the LNG sector Prescription of containment technology Oil & Gas Ship-owners Companies ▶ O&G companies are end ▶ Ship-owners order vessels users and prescribers of from shipyards LNG vessels ▶ GTT provides modification, ▶ GTT provides services feasibility a
Slide 8: GTT, the global leader in LNG containment technologies
GTT, the global leader in LNG containment technologies Current Global LNG Fleet (1) Global LNGC Orders (2008 – 2013) Other Moss <1% c.10% Moss 30% c.90% 70% Total: 366 vessels Total: 119 orders globally(2) Source: Company data, Wood Mackenzie LNGC (Liquefied Natural Gas Carrier); FLNG (LNG Floating
Slide 9: GTT vessel orders received since the beginning of 2014
GTT vessel orders received since the beginning of 2014 Technology Ship owner Number Shipyard Type Delivery Year Mark III Flex Knutsen 2 Hyundai LNGC 2016 Mark III Flex K Line + MOL + NYK Line + SCI 1 Hyundai LNGC 2016 Mark III BW Maritime 1 Samsung FSRU (RV) 2016 NO 96 MOL 1 Daewoo FSRU 2016 Q1 2014
Slide 10: GTT Business Model: Robust and sustainable
GTT Business Model: Robust and sustainable ▶ High barriers to entry and significant market shares ▶ Engineering expertise with a 50-year track record ▶ Long term visibility on revenue stream ▶ Lean cost base offering high operating leverage ▶ Highly cash generative business and negative working capi
Slide 11: Sector Forecasts & Business Update
Sector Forecasts & Business Update 2 Market trends continue post-IPO New businesses showing promise 11
Slide 12: Sector Forecasts 1/3: Strong demand dynamics underpin LNG growth
Sector Forecasts 1/3: Strong demand dynamics underpin LNG growth Advantages of natural gas Strong global LNG demand growth ▶ Natural gas is the fastest growing major energy MMtpa source ▶ Cost competitiveness, especially compared to fuel oil ▶ Abundant, widespread resources, equivalent to c. 230 yea
Slide 13: Sector Forecasts 2/3: Increasing need for LNG shipping and storage
Sector Forecasts 2/3: Increasing need for LNG shipping and storage Drivers of increase in shipping activity LNGCs required in selected key regions(1) ▶ Regional supply dynamics MMtpa 1.2 0.6 0.6 2.0 2.2 0.9 ▶ Significant growth in supply from new emerging regions ▶ 120 MMtpa increase (2013-2025) in
Slide 14: Sector Forecasts 3/3: Strong growth in LNGC sector
Sector Forecasts 3/3: Strong growth in LNGC sector Forecast LNGC orders GTT expected Average orders per year sector share Base case 23 84% POTEN PARTNERS High case 29 87% GTT expected Average orders per year sector share(1) WOOD Base case 21 MACKENZIE 90% High case 27 GTT expected Average orders per
Slide 15: Business Update 1/4: Offshore market
Business Update 1/4: Offshore market - GTT a leader with strong growth potential FSRU: GTT, the solution of choice FLNG: the new frontier of the LNG World ▶ 100% of ordered FSRUs will be equipped with GTT’s ▶ Three FLNG are currently on order for Petronas technologies(1) Malaysia and Shell Prelude(1
Slide 16: Business Update 2/4: Onshore market
Business Update 2/4: Onshore market - A large and attractive sector Membrane tanks, a proven containment storage solution Photo credit: Photo credit: GDF SUEZ_ GDF SUEZ_ HELSLY HELSLY CEDRIC CEDRIC et DUREUIL et DUREUIL PHILIPPE PHILIPPE ▶ Demand drivers: re-gasification and liquefaction projects; l
Slide 17: Business Update 3/4: Services provided by GTT
Business Update 3/4: Services provided by GTT meet the LNG sector needs Broad range of services provided by GTT Innovative services provided by Cryovision ▶ Pre-project studies ▶ Cryovision provides innovative membrane ▶ Vessel modification integrity tests MOON and TAMI to ship owners ▶ Feasibility
Slide 18: Business Update 4/4: Inception of new services
Business Update 4/4: Inception of new services ▶ Enhancement of the training offering ▶ Qualifying training for crews according to professional standards ▶ Customized training provided on-site to ship-owners, classification societies and LNG companies ▶ Creation of GTT Training as a subsidiary in UK
Slide 19: First Half financial results - 9 month revenues update
- First Half financial results 3 - 9 month revenues update 19
Slide 20: First half 2014, excellent earnings performance
First half 2014, excellent earnings performance Summary financials Key comments As of 30/06, in € MM H1 2013 H1 2014 Change (%) ▶ High level of revenues : increase of 20% compared Total Revenues 96 115 20% to H1 2013. EBITDA(1) 61 73 20% ▶ 80.2% of revenue derived from LNGCs Margin (%) 63% 63% ▶ Inc
Slide 21: 9 month revenues update: +11%
9 month revenues update: +11% Summary financials Key comments As of 30/09, in € k 9M 2013 9M 2014 Change (%) ▶ Total revenues: +11% Revenues 156,942 173,574 11% ▶ Revenues from royalties: +10% Royalties 151,401 167,062 10% ▶ Dynamic performance from LNGCs, and the % of revenues 96% 96% new VLECs, to
Slide 22: A well-balanced portfolio, and strong order book at end Q3
A well-balanced portfolio, and strong order book at end Q3 Strong order book Visibility goes now up to 2019 (2017 at the time of IPO) ▶ 101 LNGCs/VLECs LNGC/VLEC FLNG FSRU/RV ▶ 8 FSRU/RV (regasification vessels) 40 ▶ 3 FLNG 30 ▶ 2 onshore storages 20 10 First 9 months movements(1) in the order book
Slide 23: Strategy & Outlook
Strategy & Outlook Excellence Innovation Teamwork Transparency
Slide 24: Strategic Roadmap 1/6: Develop promising new business areas and products
Strategic Roadmap 1/6: Develop promising new business areas and products LNG as a fuel Enlargement New concepts: e.g. inspection equipment and services New TAMI applications REACH4 MOON Enhancement TIBIA New customers / geographies Sloshield Offshore Specific conditions Small scale Onshore Ethane/ F
Slide 25: Strategic Roadmap 2/6: LNG as a fuel
Strategic Roadmap 2/6: LNG as a fuel - GTT technologies well-suited to benefit Stricter emissions standards: January 2015 Significant opportunity for GTT Norvège Mer Baltique Mer du Nord Amérique du Nord Mer Méditerranée Japon Etats-Unis/ Caraïbes Mexique Singapour Existing ECA Possible future ECA S
Slide 26: Strategic Roadmap 3/6: Small Scale applications
Strategic Roadmap 3/6: Small Scale applications - A Great Potential A worldwide emerging market for small scale applications: LNGCs and onshore storage tanks ▶ Small LNG carriers are crucial for supplying merchant vessels with LNG ▶ Significant geographical potential: Caribbean, China, India, Middle
Slide 27: Strategic Roadmap 4/6: Develop the range of services to support LNGCs
Strategic Roadmap 4/6: Develop the range of services to support LNGCs throughout lifecycle Pre-project studies Advanced training Maintenance and Repair TAMI MOON Thermal camera MOtorized BalloON for secondary for primary membrane membrane inspection inspection Recently launched innovative services T
Slide 28: Strategic Roadmap 5/6: New developments
Strategic Roadmap 5/6: New developments are coming up, providing enhanced operational performance and flexibility Mark V for LNG Carriers NO 96 Max ▶ Bonded triplex replaced with Invar: ▶ Innovative pillar-type insulation box Innovative secondary membrane, construction allowing quicker industrializa
Slide 29: Strategic Roadmap 6/6: Value-add from in-house GTT innovation
Strategic Roadmap 6/6: Value-add from in-house GTT innovation Performance of GTT technologies Value of reducing BOR to a ship-owner / O&G major BOR of GTT systems developed since 2010 10 year NPV of reduced BOR for an LNGC, in $ MM(1) 0.16% 0.12% 0.08% 0.04% 0.00% 1992 2011 2013/14 1994 2011/12 2014
Slide 30: Outlook 1/2: Outlook revised for 2014
Outlook 1/2: Outlook revised for 2014 ▶ Expected 2014 revenue close to €227 M (outlook revised on December 2, 2014) ▶ Net margin of c. 50% ▶ 2014 dividend payout of at least 80%(1) ▶ Interim dividend payment of €1.50 per share on September 29, 2014 (1) GTT by-laws provide that dividends may be paid
Slide 31: Outlook 2/2: Medium-term outlook confirmed / 2015 revenue outlook revised
Outlook 2/2: Medium-term outlook confirmed / 2015 revenue outlook revised Medium Term ▶ 270-280 LNGC New GTT Orders ▶ 25-35 FSRU over 2014-2023 ▶ 3-7 FLNG ▶ c. 10 onshore storage tanks Average revenue ▶ No significant change compared to 2012 and 2013 levels, except for inflationary price per vessel
Slide 32: Conclusion: GTT, a unique vehicle to capture LNG growth
Conclusion GTT, a unique vehicle to capture LNG growth in coming years ▶ Strong macro themes underpin LNG growth ▶ GTT offers pure play exposure to LNG investment theme ▶ Significant upside opportunities in adjacent sectors ▶ Highly attractive business model with high switching costs ▶ Clear sector
Slide 33: Appendices
Appendices Excellence Innovation Teamwork Transparency
Slide 34: Appendix 1: US projects
Appendix 1: US projects Development of US LNG projects provides for significant potential export capacity Significant potential US LNG development projects Department of Energy Federal Energy Regulatory Commission Expected Capacity Export to FTA Export to non-FTA Projects (MMtpa) Filed Approved File
Slide 35: Appendix 2: Forecasts - FSRU
Appendix 2: Forecasts FSRU: Leadership position with high-growth potential Drivers for FSRU demand GTT – a superior technology for FSRUs ▶ Existing fleet of 21 FSRUs(1) ▶ All of the newbuild FSRUs ordered to date will be equipped ▶ Demand driven by competitive advantage vs. land-based terminals with
Slide 36: Appendix 2: Forecasts - FLNG
Appendix 2: Forecasts Emergence of the FLNG sector FLNG projects progressing GTT – a superior technology for FLNGs ▶ Three FLNGs are currently on order for Petronas Malaysia and ▶ The only three post-FID (Final Investment Decision) FLNG Shell Prelude respectively (1) projects will be equipped with G
Slide 37: Appendix 2: Forecasts - Onshore storage
Appendix 2: Forecasts Onshore storage, a large and attractive sector GTT returning to… … A large and growing sector ▶ Technology initially developed by Technigaz in the 1960s secured a ▶ Demand driven by: total of 33 orders ▶ Development of re-gasification and liquefaction projects ▶ In 2006, GTT re
Slide 38: Appendix 3: GTT Business Model
Appendix 3: GTT Business Model Illustrative LNGC revenue recognition summary Illustrative revenue recognition 2013 key statistics % of total revenues – order of 4 LNGCs placed on June 30th of year 0 c. 18 months c. 18 months studies royalties Total orders: 36 TOTAL LNGC Studies 56% collected on th
Slide 39: Appendix 3: GTT Business Model
Appendix 3: GTT Business Model Strong revenue growth since 2012 reflecting recent increase in order intake Historical revenue development Order book evolution In € MM In number of orders – at end of period 99 250 77 218 52 7 200 18 2010 2011 2012 2013 150 2013 Revenue Breakdown 210 Onshore Services
Slide 40: Appendix 3: GTT Business Model
Appendix 3: GTT Business Model Strong order book and visibility on future revenue (as at 31/12/2013) Current order book (1) Order book by year of delivery Total orders to be delivered between 2014 – 2017 40 36 120 32 21 99 20 2 10 2 90 10 0 2014 2015 2016 2017 Scheduled deliveries (vessels per year)
Slide 41: Appendix 3: GTT Business Model
Appendix 3: GTT Business Model A cost base offering a high operating leverage GTT operational costs(1) Key comments As of 30/06, in € MM H1 2013 H1 2014 Change (%) ▶ Lean cost base offering high operating leverage Salaries and Social ▶ Total costs stable at around 40% of sales (12,9) (20,8) 61% Char
Slide 42: Appendix 3: GTT Business Model
Appendix 3: GTT Business Model A contractual framework governs and protects GTT’s expertise in construction projects Technical Assistance and License Agreement (TALA) ▶ TALA is a framework agreement between GTT and the shipyard ▶ GTT grants non-exclusive licence to the shipyard to use its technology
Slide 43: Appendix 3: GTT Business Model
Appendix 3: GTT Business Model An attractive business model supporting high cash generation Invoicing and revenue recognition Business model supports high cash generation % of contract (1) ▶ Revenue is recognized pro-rata temporis between c. 18 months c. 18 months Delivery 100 studies royalties mile
Slide 44: Appendix 3: GTT Business Model
Appendix 3: GTT Business Model Managing employee base to meet growing demand Evolution of GTT staff GTT staff by type of contract 370 388 400 Non-permanent 300 286 24% 242 200 100 Permanent 76% 0 Dec2011 31, 2011 Dec 31, 20122012 Dec 31, 2013 2013 June 30, 2014 2014 Total: 388 employees(1) ▶ Staff l
Slide 45: Appendix 4: General information
Appendix 4: General information Track record of high margin and strong increase in backlog since 2010 Current backlog (3) 120 112 66 30 18 52 77 99 44 37 34 26 Evolution of new 19 GTT orders (1)(2) 7 4 1 2006 2007 2008 2009 2010 2011 2012 (5) 2013 LNGC FSRU/FPSO Onshore storage Historical backlog (#
Slide 46: Appendix 4: General information
Appendix 4: General information Shareholding structure as at December 9, 2014 Before IPO and capital increase As at December 9, 2014 reserved for employees TEMASEK Employees and management 30% 40% 10.38% 0.19% 40.41% Free-float, including Hellman & Friedman with 4,99% 49.02% 30% New lock-up for H&F
Slide 47: GTT SA organisation
Appendix 4: General information A streamlined group and organisation GTT Group GTT North America Cryovision GTT Training Subsidiary Subsidiary Subsidiary Philippe Berterottière Chairman and Chief Executive Officer GTT SA organisation Research Committee Manuèle Haton Organization and Quality Lélia Gh
Slide 48: Appendix 4: GTT membrane technologies
Appendix 4: General information GTT membrane technologies NO 96 Mark III Primary Invar membrane Primary stainless steel membrane Top bridge Invar pad tongue Primary Corner Metallic insert insulation box panel Hard wood key Coupler Secondary Invar Inner membrane hull Top plywood Inner hull Insulation
Slide 49: Thank you for your attention
Thank you for your attention [email protected] • Lisa Finas and Lynda Khoudi • +33 1 30 23 47 89 49
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